Yep. This is the final week, and the personal filing deadline (April 15th) is *so* close.

It’s officially the final week of tax season — and we are working our tails off for you and our other Ventura County clients.

But I’m still taking the time to step away for a moment and write to you, my friend. And if you have all your papers in, and are waiting for our completion — fear not — my team is hard at work, as I type…

Oh, and if for some reason you haven’t done ANYTHING with your taxes yet, it’s actually not too late. More about that in a moment.

But first, there’s a lot of “business” in this note, so please make sure you read it all — it could make a huge difference.(Honestly, I much prefer writing the notes that are a little more “interesting”, but this is really crucial information.)

And you know what else would make a huge difference? If we heard from you. Would you leave us a review on Google or other online platforms for potential clients to see? We have found that these sources can be so helpful for people evaluating their options, and would love to have as much information there as possible. Thank you!

But yes — this is often our busiest week of the year (so please be understanding), and it’s also the week when we receive, with clockwork regularity, many questions about extensions and payment options.

But before I get to that: other deadlines that fall on April 15th this year:

1) Estimated taxes for the first quarter are due.

2) Want to open or contribute to an IRA or Roth IRA for 2018? Gotta get that done by Monday the 15th.

3) Final day to max out contributions for your 2018 HSA (Health Savings Account).

4) Claim any refund money from an unfiled 2015 return. (There is $1.4 BILLION in unclaimed refund money out there for that year — but only available if you didn’t file.)

Alright — let’s dive into my thoughts on extensions and payment options (if you aren’t able to pay your tax bill right away)…

2018 Tax Extensions and Payment Options for Ventura County Taxpayers

“If you spend too much time thinking about a thing, you’ll never get it done.” – Bruce Lee

As you know, this upcoming Monday, April 15th is the filing deadline for a federal tax return (except for you Maine and Massachusetts people — you get until the 17th). If you need more time to get your paperwork complete, you need to file (or have us file on your behalf) this form: http://www.irs.gov/pub/irs-pdf/f4868.pdf with the IRS by the end of the day on the 15th (the 17th for ME and MA residents). This gives you an automatic six-month (until October 15, 2019) extension of time to file.

Here’s the deal: An “Extension of Time to File” is not an “Extension of Time to Pay”, unfortunately. The extension simply gives you an automatic six months of additional time to get your paperwork together and file that return. But, if you owe more than what you paid with your estimate, you’ll be accumulating penalties and interest on the difference — so PLEASE don’t take the entire six months to do this!

So, when filing your “Extension of Time to File”, you’ll need to estimate what you think you owe to the IRS. This should not be pulling numbers out of thin air (or other various body parts). You’ll still need to go through your receipts and tax documents and get them “somewhat” organized.

From here, you can estimate both your income and your expenses, and then approximate what you owe Uncle Sam. Keep in mind that this is an ESTIMATE. Then you’ll have to pay what you estimate you owe at the time we file for the extension.

You can do this all electronically through our office, you can mail in the form WITH estimated payment (must be postmarked by the 15th), or you can call a specialized provider and pay by credit card. We can provide you with the appropriate number to call.

3) “Financial hardship” delay: This is if paying your tax bill would demonstrably affect your ability to pay your other bills. Interest and penalties still accrue, but it’s better to register this with the IRS than to simply ignore the bill.

4) Installment payment plan: If you owe less than $50K in taxes, you should usually be able to get an installment payment plan of up to 72 months, simply by asking for it. If this is something you are considering, please let’s talk it over to make sure we come up with the best plan. But you can apply online for this here: https://www.irs.gov/Individuals/Online-Payment-Agreement-Application

5) Negotiate: This is NOT something to try on your own. We can help, but the number of “Offers in Compromise” that get accepted each year are quite small and a knowledge of how the system works is important.

6) Using existing credit sources (credit card, HELOC, private loans): Some tax advisors would quickly recommend this, but I would NOT recommend you go this route. If you’ve exhausted the options above, do this instead…

Okay, that’s a joke. We’re so busy with our client work, we can’t really enjoy the college basketball or the new baseball season, but at least we still have April Fools.

And yes, I know that day has already passed. More coffee please.

But speaking of things getting past us — are YOU procrastinating with your taxes?

If so, you’re not alone. The most recent IRS data we’ve seen as practitioners shows that overall, tax filing is slower than in recent years. The new tax laws, the earlier government shutdown, and lots of confusion out there has meant a lot of late-filers.

Perhaps that’s you? Or some of your Ventura County friends?

In fact, did you know that some tax firms (and “off the shelf” software companies) actually raise their prices on procrastinators? That’s not how I believe clients should be treated.

Now, speaking of things that are often missed…

An Under-Utilized Tax Break For Ventura County Taxpayers: Summer Day Camp

“Deep summer is when laziness finds respectability.” – Sam Keen

As our weather has finally (maybe?) turned toward spring, we know summer is right around the corner. I want to give you three ways you can look out for tax savings when it comes to summer day camps. Taking this information into account will help you plan your summer accordingly, as you think about signing your children up for this win-win opportunity.

Decisions, Decisions

Before we get to the tax part, a quick word on summer day camps.

You might have noticed I’m not saying just “summer camp”. Traditionally, overnight summer camps have been a fun experience for kids, but without a doubt, day camps have grown exponentially across the U.S. as they are often cheaper and more convenient.

If you are curious about summer day camps for your kids or grandkids, just Google “summer day camps in Ventura County (or your specific area)” and a plethora of options should come up for you to check out.

Summertime Taxes

Ready for the good news now (and something your parents might not have known)?

The Child and Dependent Care tax credit directly applies to summer day camp costs. The tax credit covers up to $3,000 for one child and $6,000 for two or more.

However, you won’t see a tax break for the exact same amounts you pay. Why? The tax credit you receive will merely be a percentage based on your annual income. There is some math involved, and this outline via IRS.gov will help on the technical side of things, but let me throw something else your way:

The summer is a great time for us to schedule our first meeting related to your 2019 taxes. I would love to help you approach tax season next year with more confidence than ever before. As this tax season winds down, please reach out and give me a call. Some of these tax credits (like the Child and Dependent Care credit), the math and legal terminology can be confusing. But that’s why I want to help.

Right here: (805) 650-1052

Now, while the kids are away, make sure some cash can stay.

Worthy To Note

Lastly, it’s important to note this summer day camp tax break only applies to children under 13 years old. The child also needs to be considered your dependent. And remember the break won’t count towards overnight camps, only the growing-in-popularity day camps like we mentioned before.

As you gear up for seasonal sunshine and kids running rampant, know there is some cash (and sanity?) you could save … all you need to do is send your kids to day camp and give me a call.

But you know what we DO have time for? Saving you a boatload on your taxes, and finding creative ways to do that, even if you don’t think about it.

I have an example for you today, but before I get there, allow me also to inform you that there is currently $1.4 billion (yes that’s with a B) in unclaimed tax refunds sitting on Uncle Sam’s books right now from 2015. If you somehow didn’t file a tax return in 2015 (or maybe you did, and you just … aren’t quite sure it was done right), well, we’re right here. Let’s help you get what is rightly YOURS.

It’s what we’re here for.

And you know what we’re also here for? Creative tax deductions. You “pet”cha…

Diana Castro’s Under-Utilized Pet Tax Deductions

“The better I get to know men, the more I find myself loving dogs.” – Charles de Gaulle

I’m going to dip into the “something you don’t hear every day” file with an interesting bit of information: our pets can save us some serious cash.

Well, it may not be serious cash in terms of a massive amount, but I am serious about this interesting set of pet tax deductions.

Here are a few ways a pet could save you, or someone you know, money in the future. Man’s best friend just got friendlier…

Medical-Related Expenses

Many Ventura County individuals have been diagnosed with a physical or mental condition that requires a trained therapy animal.

I’m here to tell you a therapy animal can be counted as an itemized medical expense.

However, I’ll reiterate … this is only the case if your doctor has prescribed you one of these therapy animals. No matter how comforting it is to get home and snuggle with your dog after a long day at work, that’s not the kind of thing that qualifies.

If you have a guard dog that looks over your Ventura County business after-hours, you might be eligible to write off similar expenses (food, vet, training, etc.) for a job well done.

I say “might be eligible” because it’s important you take notes of the hours your dog works on a weekly basis.

But the IRS might call you to question when they realize that your “guard dog” is your Corgi lounging around the office. Make sure, if you are going to go through the effort of keeping solid records for your guard dog, that it’s actually a guard dog.

Fostering Hope

Here is something you might not know about in the first place: there is a need out there for fostering animals while shelters find long-term homes for a pet.

This is certainly a noble cause, especially if you already have pets of your own. And write-offs accompany your effort to find those pets a permanent place. Again, it’s important you keep scrupulous notes and documentation about what you spend on your foster pets before you apply for a charitable deduction.

Of course, any pet-owner will tell you that pets are certainly more than tax write-offs. And hopefully you are now aware of one more way they help us out.

All the more reason to treat our animals well. They clearly care for us.

You see, we’ve already been knee-deep in our own version of March madness over here at Team Legacy Tax Services, and we don’t really have much time for basketball because, well … you probably understand.

With all of the changes this year, we’ve noticed a marked increase in procrastination. Which means that we are very busy, even during a time that is sometimes a calm before the April storm. But we still have a few slots open in the next couple weeks, so … we’ve set aside some capacity for friends and family of our Ventura County clients.

Now, with the news from New Zealand over the weekend, the world is rightly reeling. It’s a reminder that pain and disaster can strike any time, any place. And, as a result, you also might have forgotten about what happened in Alabama and Georgia just over two weeks ago. So many terrible things seem to happen over and over that we can get numb to it all.

But I don’t want to live that way, and I bet you don’t either. So I have some thoughts today.

How Ventura County Taxpayers Can Support The Alabama Disaster Relief Effort

“There is no exercise better for the heart than reaching down and lifting people up.” -John Holmes

Over the last year, we have seen all sorts of natural disasters plague our nation. And anytime possible, I want to help you help others in need. From wildfires to floods to tornadoes … life is sadly full of devastating surprises.

Currently, the community of Lee County, Alabama is literally in shambles after tornadoes ripped through their towns and killed 23 individuals in early March.

Before I get to how you can help their community, please know that if you, or any friend or family member, is ever personally affected by a natural disaster, I will be here to walk you through pertinent tax questions related to your losses.There is a great IRS resource page which helps walk victims through tax-related issues following recent disasters. Tuck this info away for a day I hope never happens to you.

The IRS has already helped residents of the affected Alabama areas by pushing back their tax deadline to July 31st. Until this community can get their feet back beneath them, and towns cleaned of debris, here are a few ways you can help…

If you donate using this link to the American Red Cross, your contribution will go towards disaster relief and help communities across the country who are rebuilding from rubble.

If you want to keep your efforts focused solely on the areas affected by the recent tornadoes, theAmerican Red Cross of East Alabama will help provide food and shelter for hurting victims.

When you donate to the Community Foundation of East Alabama, 100% of your donation will go toward families in need. The Salvation Armyis providing a way for you to assist through “food and drinks, cleaning supplies and other essential commodities, financial assistance to disaster survivors, long-term recovery assistance programs including repair and reconstruction projects, or to support disaster relief workers serving in impacted communities”.

When you donate, are those contributions tax-deductible? Yes. But more importantly, when debating over giving to these organizations, know the day may come where you or someone you know is impacted by a natural disaster. It’s times like these when we realize we’re all in this together.

If you have any questions about the tax ramifications following a natural disaster, please give me a call so I can walk you through the options available.

Just about one month left before the tax deadline. As the parents say, the days are long, but the months are fast.

And as we tax pros say, the days are long, and the days are long.

But that’s simply because we’ve been getting to do some meaty, fun tax preparation work for our Ventura County clients.

Already, we have many, many clients who have filed, have received refunds and have written us notes telling us how pleased they’ve been with their filing experience. And of course, this makes me happy, as you might imagine. Now, about your tax refund … can I give you an idea?

Spending Money FromTax Refunds Wisely By Diana Castro

“Frugality includes all the other virtues.” -Cicerone

Are Christmas bonuses and tax refunds one and the same?

Not quite.

I’ve recently written about this dynamic. After all … that is YOUR money that you’re “getting back”.

Imagine this: you go to a shop and buy something for $5. You hand the cashier a $10 bill. The cashier hands you back a $5 bill as change. Did you just get more money? Of course not; you paid more than the bill, so you got YOUR money back.

Unfortunately, many Ventura County taxpayer reactions to a refund check resemble a kid on Christmas morning. And … I get it. All year long, tax withholdings got you to this point: a chance to redeem a sum of cash, maybe pay off some debt and maybe splurge on that new toy you’ve been eyeing.

But what if you started viewing your refund a little differently? What if you started putting it to long-term use instead of short-term gain?

Because remember: this was your money to begin with.

A Rainy Day Fund

In 2017, a Bankrate survey found that many Americans could not cover a $500 emergency expense (their kid breaks an arm, a windshield needs replacing, etc.). And it begs the question: could you?

Even if it’s not $500, life has a way — through our cars, our homes, our technology — of springing large, unforeseen expenses our way. They hit us like a ton of bricks, and we get frustrated … until we understand “that’s life”. I want you as prepared for “life” as you can be, and part of that means taking part of your refund and putting it toward a savings fund.

Via Credit Union

As opposed to regular banks, credit unions operate as not-for-profits. And if you’re a fan of investing into smaller businesses, saving part of your refund aside in a credit union could be a smart strategy.

We’ll chat about credit union advantages/disadvantages another day, but in short, they often offer cheaper terms and conditions — if any at all.

Setting aside money in a credit union, or bank, will take away temptation of spending. Out of sight, out of mind, right? Just make sure it stays out of sight until you really need it.

Go for GoalsA few weeks ago, we talked about delayed gratification when it comes to spending.

Tax refunds are the epitome of testing that virtue.

Without a doubt, receiving an “unexpected” sum of money is exciting. You typically think of the weekend vacation you can now afford or extravagant new restaurant you and your spouse have been wanting to try out.

Pump the brakes. Know that financial success is rarely found overnight, and never achieved through a tax refund alone. But it can provide a good first step in saving for a home, retirement or a college fund for your children.

I would love to chat more about your tax season planning, and how you can take all facets into account for your benefit.

Please reach out through the email button at the top of the page so we can plan a meeting and move from tax season, to saving, to success.